tapping the new $4b california market - marijuana business conference … · 2017-11-16 · (0.5m)...

© 2017 Anne Holland Ventures Inc. All rights reserved.

Tapping the New $4B California Market

Morgan Paxhia

Poseidon Asset ManagementManaging Director

Graciela Castillo-Krings

Governor Jerry BrownDeputy Legislative Secretary

Amanda Reiman

Flow Kana

Vice President of Community Relations

An-Chis Tsou, Ph.D.

Tsou ConsultingPrincipal


Thank You!

Morgan PaxhiaPoseidon Asset [email protected]

Graciela Castillo-KringsGovernor Jerry [email protected]

Amanda ReimanFlow [email protected]

An-Chis Tsou, Ph.D.Tsou [email protected]


Exclusive Research Results: Types of Cannabis Consumers & How to Effectively Target Them

Ana Hory

Element of Choice, EnlucemCEO


1,000 cannabis consumers and potential entrants– Online study, August’17, adults 21+ years – Users: Have purchased in the last 6 months

• Heavy users: Use it at least a few times a week– Potential: Have not purchased in the past 6 months, but plan

to purchase in the next 6 months

Conducted in five major states: California, Colorado, Nevada, Oregon and Washington

The Research


The market & demographics


One-third of adults in all states use cannabis. California market is the largest with almost 2x more users and over 2x more potential entrants of all the other 4 states combined.

31%(7M)76%

California

16% (2.8M)

Colorado

32% (1.1M)66%

8% (0.2M)

Nevada28% (0.5M)68%

15%(0.2M)

Oregon

36% (1M)68%

13% (0.4M)

Washington

35%(1.7M)67%

11% (0.3M)

State Population Source: www.suburbanstats.org

Current

Potential

HU


Current cannabis users and potential users are different


Cannabis users are demographically similar across states: Male, young, single, with household income less than $90k and they work full-time.

Male 61%

40 years or less 61%

Married 43%

Minor Kids at Home 35%

<$90K HHI 75%

Full-time 51%


Preferred product type is bud/flower, edibles and pre-rolls with heavy users preferring bud/flower and concentrates.

69%50%

44%30%

25%25%

22%17%

Bud/flowerEdiblesPre-rolls

Vaping cartridgesConcentrates

TopicalsDrinks

Tinctures


Oregon consumers spend significantly less per visit and purchase less often than other states, a function of income levels.

$59 $59 $60 $44 $54

Once/ week

A few times/ month

Once/ week

A few times/ month

Once/ week

California Colorado Nevada Oregon Washington


Current users: Female vs. Male


Female cannabis users are younger and have lower financial resources than male users.

Skew younger 21 to 30 years

Lower Household Incomes <$90K

Lower Percent Working Full-Time

37% 25% 80%72%45%56%


Female cannabis users have higher rates of anxiety, depression, headaches and insomnia.

Anxiety

33% 20%

Depression Headache

45% 26% 22% 9%

Insomnia

27% 20%


Therefore, they look to cannabis for anxiety and pain relief, and sleep aid.

Anxiety Relief

70% 53%

Pain Relief

68% 59%

Help Sleeping

66% 52%


When purchasing cannabis products, affordable prices, non-drowsy, and high CBD are more important to women than men.

Affordable prices

70% 62%

Non-drowsy

39% 31%

High CBD

32% 25%


When visiting a dispensary, affordable price, knowledgeable budtenders and the inviting atmosphere are more important to women than men.

Affordable prices

71% 63%

Knowledgeable Budtenders

57% 44%

Warm and welcoming atmosphere

53% 41%


What are they looking for?


Relaxation is the main effect cannabis users are looking for, with relief from ailments a close second. Heavy users are more likely to look for pain and insomnia relief.

78%

62%

59%

57%

33%

Relaxation

Pain relief

Anxiety relief

Insomnia help

Creativity


Affordability (price/value), fast acting, high potency/THC and non-drowsiness are important purchase drivers. Heavy users putting more emphasis on potency and strain.

84%

66%

64%

62%

59%

59%

Affordable Price

Fast acting

High potency

High THC

Non-drowsy

Cannabis strain


Potential cannabis users: 50% Female and over 51 yrs. of age (31%)


For potential users, non-smoking formats are significantly more appealing.

38%64%

38%25%

10%46%

28%25%

Bud/flowerEdibles

Pre-rollsVaping cartridges

ConcentratesTopicals

DrinksTinctures


When asked about future purchases, women are more likely than men to say they will purchase edibles and topicals in the next 6 months.

Edibles

56% 46%

Topicals

33% 19%

Candies 61%Butter/oil 35%


Potential female consumers also have higher rates of anxiety, depression, headaches and insomnia.

Anxiety

31% 15%

Depression Headache

42% 18% 25% 12%

Insomnia

32% 16%


Therefore they look to cannabis for pain and anxiety relief

Anxiety Relief

66% 48%

Pain Relief

70% 55%


When purchasing cannabis products, female potential users are more interested in products that are discrete and non-drowsy.

Discrete products

32% 19%

Non-drowsy

35% 19%


How is cannabis perceived?


Attitudes towards cannabis are consistent across all 5 states, with heavy users more likely to use it as medicine.

46%

43%

9%

3%

Cannabis is medicine

Cannabis is a way to relax, unwind and have fun

I was not interested in cannabis until I recently started learning about its medicinal benefits.

There’s still a lot of research needed to prove the potential benefits of cannabis.


When looking at potential users, marketing message should focus on its positive and medicinal benefits.

29%

34%

28%

9%

vs. 9% of current users

Cannabis is medicine

Cannabis is a way to relax, unwind and have fun

I was not interested in cannabis until I recently started learning about its medicinal benefits.

There’s still a lot of research needed to prove the potential benefits of cannabis.


Using cannabis, recreationally vs. medicinally: Potentialconsumers are more likely to use cannabis for medicinal reasons.

Cannabis Users Potential Users

51% 49%

Recreational UseMedicinal Use

42% 58%


Retailing


California has a significant home delivery business compared to other states.

67%

27%

6%

Go to Dispensary

Delivery

Other

89%

7%

4%

84%

14%

2%

90%

6%

4%

91%

7%

2%



Dispensary Loyalty: About half of consumers are loyal to one dispensary.

59%

38%

3%

1

2 to 4

5+

57%

40%

3%

48%

47%

6%

50%

45%

5%

53%

45%

1%



What consumers want most from dispensaries is similar across all states: High quality products, affordable prices, and consistent availability

31

• High quality products 88%

• Affordable prices 87%

• Consistent availability 80%

• Wide selection 78%

• Knowledgeable budtenders 76%


How to reach them?


A strategic approach: Your competitive advantage

Market • Number of competitors• Partners

You • Current position • Brand

Product • Unique• Differentiators


Top 3 ways to communicate with consumers is through social media, samples, and budtenders.

43%

43%

38%

37%

33%

28%

25%

Social media

Samples

Budtenders

Cannabis Websites

Advertising (disp.)

Email/newsletter

Coupons


Case Study 1: User, Male 25 – 40 yrs. old


Similar across all five states• Prefers to smoke bud/flower, edibles and pre-rolls

• In CA, NV and WA, they spend around $59 once a week, and $44 in OR and $59 in CO a few times a month

• They’re looking for relaxation and affordable prices


Product: Bud/flower• Main strains (i.e. Gorilla Glue, Blue Dream, Purple Kush,

Sour Diesel, GSC)• High trichome count• Use top-shelf seed• They’re pungent and dense with above average terpene

content• High THC content (around 30% or more)

• Curated strains that deliver special effects• Relaxing, pain, anxiety, insomnia, creativity


Packaging is Everything


1. Value add promotion– They’re spending an average $59, make it on your

product• Buy X oz. of your brand, get a glass container free

2. Loyalty cards (60% goes to only 1 dispensary)– Buy 9 1/8 oz., get 10th 1/8 oz. free

But it also increases cost, how to keep them low:


Product: Pre-rolls• On-the go package/storage• Two sizes (regular and mini)• Natural paper (no dyes)• With a filter vs. traditional• High THC content• Curated strains


• Unwind your day

• Good for your:• Pain (‘Relief’)• Anxiety

(‘Calming’)• Insomnia

(‘Night time’)

Marketing message


Case Study 2: Edibles


Similarities:

• Potential users: They’re both older (>40)

• They both see it as medicinal

• They’ll look for affordable prices

Appeals to both men and women equally


Candy and butter/oil• High quality ingredients• ‘Organic’• Lab tested and certified• Right dosing

• X mg of THC per dose• Non-drowsy• High CBD

How to reach women: Product


Medicinal Benefits• Anxiety –

’Calming/Comforting’• Depression – ‘Awaken’• Headache – ‘Relief’• Insomnia – ‘Night time’

How to reach women: Marketing message


Sweet baked goods, candy and chocolate• High potency• Cannabis strain• Lab tested and certified• Right dosing

• X mg of THC per dose

How to reach men: Product


Unwind your day

And Medicinal Benefits• Pain - ‘Relief’

How to reach men: Marketing message


ABSOLUTELY.1. Best way to do it: Offer a product line (different flavors,

strain types, formats)

2. There’s no one product that only appeals to one gender

Can an edible appeal to both men and women?


How do I market without making health claims? Do it like the Nutraceuticals


1. There are more similarities than differences across states

2. Create and market products that deliver on key target needs

3. When you face a hurdle, look at how others are solving it

4. And remember: You play a key role in shaping the industry

In a nut shell:


THANK YOU!

Ana Hory

[email protected]

Element of Choice, Enlucem


What’s New in Washington DC: Federal Policy Update

Michael J. Correia

National Cannabis Business Association (NCIA)Director of Government Relations

Michael Liszewski

The Enact GroupPrincipalCongresswoman Dina Titus

U.S. House of Representatives


THANK YOU!

Michael J. CorreiaNational Cannabis Business Association (NCIA)[email protected]

Michael LiszewskiThe Enact [email protected]

Congresswoman Dina TitusU.S. House of Representatives702-220-9823

tapping the new $4b california market - marijuana business conference … · 2017-11-16 · (0.5m)...

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